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<\/a><\/div>The Only Constant is Change (Especially with Taxation)<\/a><\/span>We talk a lot about people not doing tax planning and not spending more time creating the tax outcomes they want. We urge people to understand that it\u2019s within their own control and that tax outcomes can be legally and ethically manipulated. We go on and on about the benefits. \u00a0But\u2026we understand why it\u2019s so rarely done! It is because almost nothing in people\u2019s lives has more constant change than taxes, and keeping up with all the changes can be an overwhelming challenge.\u00a0What if every four years your banking rules changed, \u201cOh I\u2019m sorry John, we no longer pay you interest, now you pay us interest to keep money here.\u201d\u00a0Or \u201cNow you have to send in your mortgage payment daily,<\/p><\/div><\/li>
<\/a><\/div>Smart Business Owners Increase their Company\u2019s Sale Value Before and After Tax by Planning Ahead<\/a><\/span>Most business owners in any five year period can answer yes to at least one of these life event questions that would cause them to need to know what their company is worth. 1. Are you contemplating the sale of your business? 2. Are you working with or bringing in a partner? 3. Are you contemplating or currently going through divorce proceedings? 4. Are you potentially going to have to defend yourself or your company in court? 5. Are you looking for financing? There are other possible reasons of course, but the point is that there are many times a business owner finds himself or herself needing to obtain a proper business valuation for their company. Unfortunately, it\u2019s often an<\/p><\/div><\/li>
<\/a><\/div>A Hidden Tax That You Can Avoid Paying with Proper Planning<\/a><\/span>People who earn more than a certain amount and who are enrolled in\u00a0Medicare Part B\u00a0or\u00a0Medicare Part D, or both, will face additional premiums, called The Medicare Income-Related Monthly Adjusted Amount (IRMAA). IRMAA \u201csurcharges,\u201d which is a replacement word for a tax, are based on income earned two years prior to the coverage year. So, for example, a client enrolling in Medicare in 2026 would pay an IRMAA surcharge based on their 2024 tax return. Generally there are two types of people that pay IRMAA surcharges: Those who might be affected and those who will always be affected. Because it is income based, people with an unusual income event may only be affected once, while people with higher incomes may always<\/p><\/div><\/li>
<\/a><\/div>Lower Your Tax Bill More by Using a Qualified Charitable Distribution<\/a><\/span>This is the time of year when people often start taking personal inventory of how fortunate they are and start considering charitable contributions as a way to \u201cgive back\u201d a little. For some, it\u2019s an automatic budget item in their day to day lives, but for others it\u2019s a new activity. For many years the IRS has helped people give by allowing charitable contributions to be deducted on schedule A when they file their taxes. The tax deduction value of those gifts changed with the Trump tax code simplification, as many people no longer need to file a Schedule A due to the higher standard deduction. Many people are still ingrained in their old charitable giving habits and aren\u2019t aware<\/p><\/div><\/li>
<\/a><\/div>Why Do People Fear Tax Audits More Than They Fear Overpaying?<\/a><\/span>Ask anyone if they \u201cpay too much income tax\u201d and the knee jerk reaction is almost always, \u201cYes!\u201d and without much hesitation. Why do we call that a knee jerk reaction? Because if you then follow the question up with two more questions, \u201cWhat did you pay in federal tax last year? And\/or what bracket are you in?\u201d they almost as quickly say, \u201cI don\u2019t remember, or I\u2019m not sure.\u201d Or they might guess at a bracket percentage, but usually not correctly. We\u2019ve even had people profess the pain of paying too much in tax only to discover that not only did they get back all of their withholdings, but they were given tax credit refunds of money they did<\/p><\/div><\/li><\/ul> <\/div>